Network design for time-constrained delivery using subgraphs

Delivery companies are offering an increasing number of time-definite services. Yet, little research has been done that explores the design of delivery networks and accounts for these time-definite services. In this paper, we explore such design problems for networks with a specified number of edges B > n − 1. We present a two-phase heuristic solution approach that first constructs a network and then improves the network via local search. For the improvement phase, we extend neighborhood structures that have proven effective for tree-structured solutions and also identify a new search neighborhood that takes advantage of specific features of subgraph solutions. We present a computational analysis of our solution approach as well as managerial insights.